Merrian Fuller, UC Berkeley Blair Hamilton, Efficiency Vermont & - PowerPoint PPT Presentation

Merrian Fuller, UC Berkeley Blair Hamilton, Efficiency Vermont & VEIC

Residential EE Financing Case Studies Residential EE Financing Case Studies Conventional On-Bill Financing AFC First’s Home Energy Loan (PA) BC Hydro (terminated) � � City of Cambridge (new) City of Cambridge (new) First Electric Cooperative (AR) Fi t El t i C ti (AR) � � � Efficiency Vermont � Manitoba Hydro � KEMA’s California EE Loan Fund � NW Natural Gas (terminated) � (terminated) ( ) (Portland) (Portland) MN Center for Energy and � Environment Tariffed Installation Program (TIP) w/ NYSERDA's Energy $mart Loan Fund � On-Bill Repayment NYSERDA's HPwES Loan Program NYSERDA s HPwES Loan Program � � Nebraska Energy Office � Maui Electric Company � Sacramento Municipal Utility District � Midwest Energy (KS) � (SMUD) ( ) New Hampshire Electric Coop Vermont Gas Systems � � (terminated) Viewtech Financial Services � Property-Assessed Clean Energy (PACE) City of Berkeley (new) � 2

Tariffed Installation Program (TIP) Tariffed Installation Program (TIP) $$ Upfront $$ Repaid on $$ Repaid on utility bill • Applies for financing • Creates approval process and criteria • Identifies work & contractor based on utilities’ criteria • Provides upfront $$ • Attaches repayment • Repays financing on utility bill • Repayment obligation R bli i obligation to the meter bli i h transfers with tenancy 3

Clean Energy Assessment District Clean Energy Assessment District (CEAD) ( ) $$ Upfront $$ Repaid $$ Repaid on tax bills • Identifies work & chooses • Creates financing district & approval process contractor • Repays financing as a line • Provides upfront $$ • Attaches repayment item on the property tax bill • Repayment obligation R bli i obligation to the building bli i h b ildi transfers with ownership 4

CEAD Progress CEAD Progress � Enabled in…. ▪ California Ca o a ▪ Colorado ▪ New Mexico ▪ Virginia ▪ Vermont ▪ Maryland ▪ Hawaii � Currently being pursued in Oregon, C tl b i d i O Nevada, Arizona, Texas, New York, Wisconsin and Montana Wisconsin, and Montana.

� Law: Mello-Roos (special tax district) � $$: Issuing “baby muni bonds” purchased � $$: Issuing baby muni bonds purchased by a financial partner who can package and resell � Terms: 7.75% for 20 years (varies based on 10-year Treasury plus 3.25%) y y p ) � Status: $1.5 claimed in 9 minutes for the solar-only pilot round, basic energy and water efficiency improvements required http://www.berkeleyfirst.renewfund.com/ 6

� Law: HB 08-1350 (assessment district) � $$: Collecting applications and will issue � $$: Collecting applications and will issue a bond this month � Terms: TBA (max 8.75%), 15 years Terms: TBA (max 8.75%), 15 years � Status: 1,700 people attended public workshops in March, $9+ million p claimed by 500+ applicants in April; projects include a wide range of energy efficiency and renewable energy measures www.climatesmartloanprogram.org li l 7

� Law: Redefined “municipal solid waste” � $$: Used existing municipal solid waste $$: Used ex st g u c pa so d aste fund as revolving loan pool � Terms: 3% term varies based on expected savings � Status: 98 homes have claimed over $670K in first 6 months for air sealing, insulation, and replacing space heating and hot water systems; est. average d h t t t t savings of 28% per home http://ligreenhomes com http://ligreenhomes.com 8

150+ E 150+ Energy Efficiency Financing Effi i Fi i Programs in the US… g Success!! Our work is done. Most programs reach p g less than 0.5% of their potential participants p p p each year 9

� “Not worth the effort” � Lack of convenient, actionable information � Uncertainty about the energy savings � Uncertainty about the energy savings � Few comprehensive service providers � Split incentives � High upfront cost � Others � Others… 10

Lesson: Program Design Details Matter Lesson: Program Design Details Matter � Quality assurance � Choose the right measures for deep p comprehensive savings � Efficiency before Renewables? Efficiency before Renewables? � Increased rewards � Increased rewards for increased efforts � Education 11

Lesson: The Role of Contractors Lesson: The Role of Contractors Matter � Contractors are the best sales force (NY, PA, VT) l f ( ) � Time & money required to Ti & i d t engage contractors � More training needed 12

Lesson: Scale Matters Lesson: Scale Matters � Higher volume programs will be p g significantly lower cost per project � Streamlined process both for homeowner both for homeowner & contractors � Marketing and k d outreach are KEY for long term success long-term success 13

Lesson: Messages and Messengers Matter Lesson: Messages and Messengers Matter � Engage local groups that already have trust that already have trust & connections � More dynamic, appealing messages are appealing messages are needed � Package offerings - make it simple for p customers 14

Most Important: Financing needs to be available to those who need it � Need to address limits on N d t dd li it credit � Be aware of who is left out � Low/moderate income / � Renters � Some options: S ti � Loan guarantees � Lower interest rates � Lower interest rates � Alternative credit measures � Additional rebates � Pay for handholding � Guarantee savings 15

Most Important: Financing must support deep, comprehensive retrofits d h i fi � Longer terms (~10-30 years) � Secured to property, not individual p p y, � Mortgages ▪ Time of sale Time of sale ▪ Refinancing � Clean Energy Assessment Districts � Tariffed Installation Program g 16

Contact: Merrian Fuller, merrianfuller@gmail.com M i F ll i f ll @ il Blair Hamilton, Bhamilton@veic.org Vermont version of the report: www.veic.org/ResourceLibrary.cfm g y PACE Seminar materials and How To Guide (in June): rael.berkeley.edu/financing

� Law: AB 811 (assessment district) � $$: Used general revenue funds to start, $$ g , then Redevelopment Authority bonds, now looking for additional funds � Terms: 7% up to 20 years � Status: $7.5 million claimed since Nov 2008 launch; of 206 applications over half 2008 l h f 206 li ti h lf EE (AC upgrades, pool pumps, insulation) but 70% of funds to solar all but 3 are but 70% of funds to solar, all but 3 are residential projects http://www.cityofpalmdesert.org/Index.as p // y p g/ px?page=484 19

� Law: AB 811 (assessment district) � $$: Using County funds to start, may sell bonds in the future; up to $100M available this year � Terms: 7% up to 20 years % 20 � Status: $2.1 million claimed since March 2009 launch; water efficiency, M h 2009 l h t ffi i energy efficiency, and renewable energy projects allowed energy projects allowed www.sonomacountyenergy.org 20